Lonnie G. Johnson has amassed 71 patents since 1979
including a smoke alarm, a valve for maintaining soil moisture, a fluid-powered
thermodynamic heat pump and a wet-diaper detector that plays nursery rhymes.
Although Johnson has invented thermodynamics systems for NASA, he may be
remembered best for a toy originally known as the Power Drencher -- the first
water blaster to incorporate air pressure. After it was renamed the Super
Soaker in 1992, Johnson’s invention went on to generate $200 million in sales. Like many inventors, Johnson avoided the hassle of
manufacturing and selling his invention himself. Instead, his company, Johnson
Research & Development licensed the rights to the
Larami toy company. While Johnson toiled on new money-making ideas, Larami
promoted and protected the Super Soaker, making it one of the biggest hits in
toy history.

Many inventors prefer to take the same route as Lonnie G.
Johnson and license their inventions. A license is an agreement in which you
let someone else commercially use or develop your invention for a period of
time. In return, you receive money -- either a onetime payment or continuing
payments called royalties. Before considering licensing, many inventors consider two
other basic alternatives to licensing: assigning your rights or manufacturing
and selling the invention by yourself. Although a license allows you to retain
ownership of the invention, some inventors prefer to assign all rights in
return for a large one‑time payment. As for manufacturing and selling the invention
yourself (referred to as a venture), most inventors do not have the funds or
experience to create ventures or to market their own products. Manufacturing
and marketing require money, knowledge about the industry, connections with
distributors, and a lot of hard, hard work. In addition, many inventors cannot
afford the significant expense of pursuing infringers. For this reason, most
inventors choose licensing instead of ventures. We discuss all of these options
in this section.

Learn More About Making Money

Ready to start strategizing about profits from your invention? Here are some tips and resources for getting started.